The agricultural marketing system in the country has come a long way since Independence. It has moved through various stages such as regulations and reforms. Now, the time has come to establish a barrier-free market operating beyond State boundaries.

A National Agricultural Market with potential to curtail inflation and ensure competitive prices to producers has also been suggested by the Government (the Economic Survey 2013-14).

The concept suggests an integrated common market operating at the national level with harmonised regulations with respect to various provisions under APMR Act, quality standards, food safety, market information systems, encouraging investment under public-private partnerships, etc.

Integrated system The enhanced degree of competiveness achieved through better participation of traders in the National Agricultural Market will help producers realise better prices.

The integrated system of distribution enabled by better infrastructure will help farmer fetch a premium through better quality and minimisation of post-harvest losses.

Rationalising the influence of traders on the system will help farmers better and their participation may be enhanced through innovations such as group formulation.

The vertical development of value chain will help in incorporating the distribution of inputs such as seeds, fertilisers and chemical, and technology and percolating the benefits to the beneficiaries under various schemes of the Union and State Governments.

The integration of all participants will ensure efficient distribution of goods. Better control and discipline on the supply chain are required to respond to the changing needs of customers in national and international markets and will help in getting better price. .

The larger market obtained as a result of better inter-linkages and free movement of commodity between States will help in developing industry linkages, create greater industrial capacity to produce goods and encouraging private players to participate in creating modern infrastructure mainly storage, market, agri-business, processing and transport.

If the national market is gradually shifted to an e-platform, it will operate on standardised grades and integrate banking, transportation and storage, resulting in various benefits to farmers through better price realisation, quick payment settlement, input and technology delivery, etc.

The implementation of the concept of common market at the national level under present conditions will be a gradual process.

Limitations such as disparity in the legal regulations governing trade of agricultural commodities in different States, limited availability of infrastructure, absence of grade-based trading, limited participation of farmers due to small holding size and issues related to sharing/foregoing fee collected on agricultural trade through regulated markets under APMC system needs to be overcome before we embark on National agricultural market.

A pragmatic solution To begin with, the pragmatic solution could be by establishing Commodity Specific Single Common Market. The commodity-specific approach will reduce the requirement of investment and infrastructure.

For example, in case of arhar, there are about 550 markets which reported arrival of the commodity in 2013. But over 90 per cent of the arrival was confined only to some 95 markets. These 95 markets are again located in nine States.

Thus, creating sufficient infrastructure in key markets and ensuring enabling legal environment and adequate financial outlays in selected States is a better approach for creating a commodity-specific national common market.

The national agricultural market has the potential to not only to control inflation and ensure better prices to the producer but also to overcome many problems faced in traditional agricultural marketing system and making it responsive to changes taking place in national and international market.

The writers are faculty members, National Institute of Agricultural Marketing, Jaipur

Related Topics
comment COMMENT NOW